Updated: Compass Group to Take Over Services at A&M

Texas A&M University System Chancellor John Sharp announced today that Compass Group, a major private company based in North Carolina, will be taking over dining and support services at Texas A&M University.

by Reeve HamiltonJune 21, 201210 AM

Newly appointed Texas A&M Chancellor John Sharp answers a question from the audience at TribLive on September 29, 2011.
Bob Daemmrich

A&M System officials insist that no current employees will lose their jobs because of the change. Additionally, they said they anticipate making a substantial profit from the deal. Compass Group will put in $45 million up front, and the system expects to generate up to $260 million in revenue and cost savings over the next decade.

"Schools would love to generate this type of value through athletics," Sharp said. "We are very pleased to have done it through dining and facility services."

It's been a big week in Aggieland. On Monday, they announced that College Station would play host to a major federal biosecurity center after securing a contract worth more than $285 million.

Original Story, June 1:

In February, when news broke that Texas A&M University System Chancellor John Sharp was putting out requests for proposals for private companies to take over dining, landscape, building maintenance and custodial services at the system's flagship campus in College Station, the reaction of the staff was decidedly negative.

System officials said the move was necessary because Texas A&M University was losing roughly $1 million each year on managing dining services alone, but workers feared the push to save money would mean cost them their jobs.

In a letter to administrators, the faculty wrote, “We believe the intended actions will have significant negative impacts on operations and morale at the university yet are not likely to result in significant cost savings.”

Sharp, meanwhile, speculated that whatever private company won the bidding process would likely prefer to keep the workers who were already in place.

As the process reaches its conclusion, early indications are that some on campus may be pleasantly surprised. According to a source close to the deliberations regarding dining services, not only will those employees keep their jobs, including their current salaries and benefits, but the final arrangement may be a significant revenue generator for the university.

The committee handling the proposals have completed their review of the options for dining services and submitted their recommendation to A&M President R. Bowen Loftin on Friday. The current university dining organization was permitted to compete equally, though apparently it did not come out on top.

According to the source, under the proposed deal, one of the country's largest private dining service companies would take over operations at A&M, though officials declined to specify which one. All current employees would be retained with their salaries and benefits.

The arrangement is projected to bring in approximately $125 million for the university over 10 years — a significant swing from the previous loss on the endeavor of $10 million or more in the same amount of time.

Loftin has the final say over whether this and the proposals for custodial services, building maintenance and landscaping — which have yet to be finalized — are accepted or declined.

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